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All products go through a life-cycle. However, the genius of an organization lies in how to manage the life-cycle of the product and extend it as necessary to serve the customers. Thus, it is not merely the wizardry in technology and manufacturing that determine the ultimate longevity of the product in the market and the mind share of the customer. The product has to respond to the diversity of demands determined by disposable income, demographics, geography, etc. In business school speak, we say that this is part of market segmentation coupled with the appropriate marketing message. However, there is not an explicit strategy formulated around identifying

Corporate Culture

Extended Culture

To achieve success, firms increasingly must develop products by leveraging ad coordinating broad creative capabilities and resources, which often are diffused across geographical and cultural boundaries. But what we have to explore is a lot more than that from the incipient stages that a product has imagined: How do we instill unique corporate DNA into the product that immediately marks the product with a corporate signature? In addition, how do we built out a product that is tenable across the farthest reaches of geography and cultural diversity?

Thus, an innovative approach is called for in product development … particularly, in a global context. The approach entails getting cross-disciplinary teams in liberal arts, science, business, etc. to work together to gather deeper insights into the cultural strains that drive decisions in various markets. To reiterate, there is no one particular function that is paramount: all of them have to work and improvise together while ensuring that there are channels that gather feedback. The cross disciplinary team and the institutionalization of a feedback mechanism that can be quickly acted upon are the key parameters to ensure that the right product is in the market and that it will be extended accordingly to the chatter of the crowds.

Having said that, this is hardly news! A lot of companies are well on their way to instill these factors into product design and development. Companies have created organizational architectures in the corporate structure in a manner that culturally appropriate products are developed and maintained in dispersed local markets. However, in most instances, we have also seen that the way they view this is to have local managers run the show, with the presumption that these “culturally appropriate” products will make good in those markets. But along the way, the piece that dissembles over time on account of creating the local flavor is that the product may not mirror the culture that the corporate group wants to instill. If these two are not aptly managed and balanced, islands of conflict will be created. Thus, my contention is that a top-down value mandate ought to set the appropriate parameters inside which the hotbed of collaborative activity would take place for product design and development in various markets.

Thus the necessary top down value systems that would bring culture into products would be:

Open areas for employees to express their thoughts and ideas

Diversity of people with different skill sets in product teams will contribute to product development

Encouraging internal and external speakers to expound upon the product touch points in the community.

Empowerment and recognition systems.

Proper formulation of monetary incentives to inspire and maintain focus.

“My own heroes are the dreamers, those men and women who tried to make the world a better place than when they found it, whether in small ways or great ones. Some succeeded, some failed, most had mixed results… but it is the effort that’s heroic, as I see it. Win or lose, I admire those who fight the good fight.” – George Martin

“Stories, like people and butterflies and songbirds’ eggs and human hearts and dreams, are also fragile things, made up of nothing stronger or more lasting than twenty-six letters and a handful of punctuation marks. Or they are words on the air, composed of sounds and ideas-abstract, invisible, gone once they’ve been spoken-and what could be more frail than that? But some stories, small, simple ones about setting out on adventures or people doing wonders, tales of miracles and monsters, have outlasted all the people who told them, and some of them have outlasted the lands in which they were created.” – Neil Gaiman

Heroes are not born. Circumstance and happenstance create heroes. In some cases, heroes are individuals who walk into a minefield of uncertainty that threatens their natural inclination for self-preservation in the interest of value systems and people that are alien to the individual. Thus, a private in an army is a hero already in the fact that he/she is walking into possible harm’s way and serving a cause to serve and protect people not necessarily related to him/her. One has heard the adage – one man’s freedom fighter is another person’s terrorist. Thus, someone whom we call a terrorist may be perceived a hero by someone else. Thus, in this case …it all becomes a matter of a point of view, but the fundamental point remains – a hero is considered a person who abnegates and abjures their rights to self-preservation for some greater perceived good.

Sustaining innovation is a vital yet difficult task. Innovation requires the coordinated efforts of many actors to facilitate (1) the recombination of ideas to generate novelty, (2) real-time problem solving, and (3) linkages between present innovation efforts with past experiences and future aspirations. Innovation narratives are cultural mechanisms that address these coordination requirements by enabling translation. Specifically, innovation narratives are powerful mechanisms for translating ideas across the organization so that they are comprehensible and appear legitimate to others. Narratives also enable people to translate emergent situations that are ambiguous or equivocal so as to promote real-time problem solving. With their accumulation, innovation narratives provide a generative memory for organizations that enable people to translate ideas accumulated from particular instances of past innovation to inform current and future efforts.

The concept of collective identity has gained prominence within organizational theory as researchers have studied how it consequentially shapes organizational behavior. However, much less attention has been paid to the question of how nascent collective identities become legitimated. Although it is conventionally argued that membership expansion leads to collective identity legitimacy, one draws on the notion of cultural entrepreneurship to argue that the relationship is more complex and is culturally mediated by the stories told by group members. Legitimacy is more likely to be achieved when members articulate a clear defining collective identity story that identifies the group’s orienting purpose and core practices. Although membership expansion can undermine legitimation by introducing discrepant actors and practices to a collective identity, this potential downside is mitigated by compelling narratives, which help to coordinate expansion. And that is where the heroes can be interwoven into organizational theory and behavior. It is important to create environments that by happenstance and circumstance create heroes. The architecture of great organizations imputes heroes and narratives in their tapestry.

Heroes and narratives are instrumental in organizations that forge a pathway to long-term sustenance and growth. Hence, we are quick to idolize figures – Iacocca, Welch, Jobs, Ellison, Gates, Benioff, Gerstner, Branson, Bezos, Zuckerberg, Brin and Page, etc. We learn narratives through case studies, news print, scholarly books on successful companies; and we emulate and steal and copy and parody and so much more … not necessarily because we want to be them but we want to create our identity in our own lair in ecosystems that move with or against the strongest currents.

So it is essential to celebrate the heroes and the narratives of great companies as an additional instrument to ignite engagement and foray into uncharted territories and conquer the unknown. Hence, personally I have also found solace in reading biographies of people who have made a difference, and a great pleasure in vicariously living through the ebbs and troughs of great companies

The Balanced Scorecard Model (BSC) was introduced by Kaplan & Norton in their book “The Balanced Scorecard” (1996). It is one of the more widely used management tools in large organizations.

One of the major strengths of the BSC model is how the key categories in the BSC model links to corporate missions and objectives. The key categories which are referred to as “perspectives” illustrated in the BSC model are:

Financial Perspective:

Kaplan and Norton do not disregard the traditional need for financial data. Timely and accurate data will always be a priority, and managers will do whatever necessary to provide it. In fact, often there is more than enough handling and processing of financial data. With the implementation of a corporate database, it is hoped that more of the processing can be centralized and automated. But the point is that the current emphasis on financials leads to the “unbalanced” situation with regard to other perspectives. There is perhaps a need to include additional financial-related data, such as risk assessment and cost-benefit data, in this category.

Customer Perspective

Recent management philosophy has shown an increasing realization of the importance of customer focus and customer satisfaction in any business. These are leading indicators: if customers are not satisfied, they will eventually find other suppliers that will meet their needs. Poor performance from this perspective is thus a leading indicator of future decline, even though the current financial picture may look good. In developing metrics for satisfaction, customers should be analyzed in terms of kinds of customers and the kinds of processes for which we are providing a product or service to those customer groups

Internal Business Process Perspective

This perspective refers to internal business processes. Metrics based on this perspective allow the managers to know how well their business is running, and whether its products and services conform to customer requirements (the mission). These metrics have to be carefully designed by those who know these processes most intimately; with our unique missions these are not necessarily something that can be developed by outside consultants. My personal opinion on this matter is that the internal business process perspective is too important and that internal owners or/and teams take ownership of understanding the process.

Learning and Growth Perspective

This perspective includes employee training and corporate cultural attitudes related to both individual and corporate self-improvement. In a knowledge-worker organization, people — the only repository of knowledge — are the main resource. In the current climate of rapid technological change, it is becoming necessary for knowledge workers to be in a continuous learning mode. Metrics can be put into place to guide managers in focusing training funds where they can help the most. In any case, learning and growth constitute the essential foundation for success of any knowledge-worker organization.

Kaplan and Norton emphasize that ‘learning’ is more than ‘training’; it also includes things like mentors and tutors within the organization, as well as that ease of communication among workers, the engagement of the workers, the potential of cross-training that would create pockets of bench strength and switch hitters, and other employee specific programs that allows them to readily get help on a problem when it is needed. It also includes technological tools; what the Baldrige criteria call “high performance work systems.”

Innovation Perspective

This perspective was appended to the above four by Bain and Company. It refers to the vitality of the organization and its culture to provide the appropriate framework to encourage innovation. Organizations have to innovate. Innovation is becoming the key distinctive element in great organizations, and high levels of innovation or innovative thinking are talent magnets.

Taking the perspectives a step further, Kaplan and Cooper instituted measures and targets associated with each of those targets. The measures are geared around what the objective is associated with each of the perspectives rather than a singular granule item. Thus, if the objective is to increase customer retention, an appropriate metric or set of metrics is around how to measure the objective and track success to it than defining a customer.

One of the underlying presumptions in this model is to ensure that the key elements around which objectives are defined are done so at a fairly detailed level and to the extent possible – defined so much so that an item does not have polymorphous connotations. In other words, there is and can be only a single source of truth associated with the key element. That preserves the integrity of the model prior to its application that would lead to the element branching out into a plethora of objectives associated with the element.

Objectives, Measures, Targets and Initiatives

Within each of the Balance Scorecard financial, customer, internal process, learning perspectives and innovation perspectives, the firm must define the following:

Strategic Objectives – what the strategy is to achieve in that perspective

Measures – how progress for that particular objective will be measured

Targets – the target value sought for each measure

Initiatives – what will be done to facilitate the reaching of the target?

As in models and analytics, the information that the model spouts could be rife with a cascade of metrics. Metrics are important but too many metrics associated with the perspectives may diffuse the ultimate end that the perspectives represent.

Hence, one has to exercise restraint and rigor in defining a few key metrics that are most relevant and roll up to corporate objectives. As an example, outlined below are examples of metrics associated with the perspectives:

The link above contains a number of templates and examples that you may find helpful.

I have discussed organization architecture and employee engagement in our previous blogs. The BSC is a tool to encourage engagement while ensuring a tight architecture to further organizational goals. You may forget that as an employee, you occupy an important place in the ecosystem; the forgetting does not speak to your disenchantment toward the job, neither to your disinclination toward the uber-goals of the organization. The forgetting really speaks to potentially a lack of credible leadership that has not taken the appropriate efforts to engage the organization by pushing this structure that forces transparency. The BSC is one such articulate model that could be used, even at its crudest form factor, to get employees informed and engaged.

Social networking, as we understand it today, comprises three major elements:
A) Content
B) Participants
C) Activity

The cross product of all of the above three lends to the gravitas of the social network and its effective reach into many aspects of the daily routine of a user.
What has transpired over the last few years is the thought that social networks should be free. The fundamental presumption is that a free network would generate activity that would gain traction and sufficient critical mass to justify its zero price value. Once the network has been able to successfully capture meaningful mind share, the next big thing would be to harness the network for revenue opportunities in order to later add quality content and greater expanse … and the cycle would be a positively self-perpetuating cycle that would theoretically know no bounds.

All of the above is fine and dandy. To reiterate, this has been the traditional model and it has continued to be overtly championed so much so that a significant number of such networks still embrace this concept. But have we stepped back and reflected upon this thought that have crystallized as a de facto model over the last few years!
I think we have, and the market is responding accordingly. I am a firm believer in the market system, as I have been steeped in the traditional compositions of Hayek, Schumpeter, Mises and the Austrian school of thought: their thesis being that the price mechanism is the big leveler. Price is not simply that numerical tag on a good or service that I am just referring to: rather, it is the abstraction of the definition that has significantly huge relevance in the economics of social networks and long-term virality and sustainability. Price is the measure of value determined by the laws of demand and supply. It is the spontaneous emergence of value created across several ecosystems that one may be immediately or indirectly connected to … but no one could or would have enough information to gauge or for that matter guide the whole toward a directed end. The value that is imputed in the price quotient changes: that much is obvious! It is governed by what Keynes had called once – the animal spirits. That fact still holds true and these “spirits” can advance or collapse societies in short notice. So what are the implications, if you will, of this short diatribe of economic thought upon social networks and the urban myth of FREE?

Free is good. Yet, Milton Friedman harangued at that word – He said, “There is no such thing as a free lunch”. But we still believe that free is the price that is most acceptable to consumers, since it would create monetizable opportunities on pure volume. Freemium became the order of the day. Get the barbarians into the gate and then cross-sell and up-sell to your heart’s content. But all along that strain of logic, we have forgotten the Friedman adage – for indeed, the barbarians at the gate are paying a price – time, energy, their conversations, their rants and rave, their hopes, their dreams – all potential fodder in the “free” social network ecosystem. What we are doing is that our technologies are creating a petri dish for guinea pigs and the enablers are forcing themselves upon the sensibilities of these “barbarians”. The common thinking – We want them in but once in, we can then strafe their sensibilities with what we determine are contextual ads and offers and relevant value parameters that they would appreciate. But all of a sudden the market has caught on to that. The house is falling down with too many barbarians through the gate; and these “barbarians” care less and less. They become cliques and guilds in a closed environment; they become oblivious to the big brother; they revolt with their attention; they shut their minds, their hearts, and yes … they shut their wallets. Yet they are there for the simple price of being part of small but meaningful conversations … a psychological need to belong, a sense of loyalty to their immediate virtual neighbors. But the noise around is overwhelming and it drowns the tidbits of conversation … so a need emerges wherein there these folks will pay for silence. The conversations will continue; conversations which have the added value of cultural diversity fuelled by the dissolution of geographical boundaries … the conversations are weighed by meaning and gravitas; a modus operandi of respect and mutual understanding … it is my contention that people are willing to pay a price for the silence in order to avert white noise and create more meaning.

So now emerges the niche networks! They offer the insulation from irrelevance: people want to be relevant; they want their conversations to be heard. They would want to reduce it to fireside chats and they measure the meaning over sips of coffee. Information and conversations are balkanized; the quality is enhanced and generally uniformed but quality ensues. The patterns of conversation become the springboard for native monetization. So we will focus on natively monetizing the buzz between connections; we will inspect the patterns of exchange and giving; we will attribute a value and we believe that a small fee will do justice to the calculus of consent.

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